All posts by Jamie Davies

Enterprise IT, hybrid cloud, News & Analysis, Oracle

Oracle expands cloud offering into customer datacentres

Oracle CloudOracle launched Cloud at Customer, a new service designed to extend Oracle’s cloud into a customer’s datacentre.

The service allows companies to place an Oracle cloud server within their own datacentre to create a hybrid environment where customers can choose whether to run workloads on the Oracle cloud or on premise. Oracle claims the new offering will remove a number of barriers to cloud adoption, as the customer will retain control on what data is stored where, removing any residency or security concerns for business critical data.

“We are committed to helping our customers move to the cloud to help speed their innovation, fuel their business growth, and drive business transformation,” said Oracle’s President of Product Development Thomas Kurian. “Today’s news is unprecedented. We announced a number of new Cloud Services and we are now the first Public Cloud Vendor to offer organizations the ultimate in choice on where and how they want to run their Oracle cloud.”

The company claims it is the first in the industry to offer such a service and aims to address security and regulatory barriers for cloud adoption. Oracle stressed the service complies with many security and data regulations including FedRAMP for the US federal government, Germany’s Federal Data Protection Act and the United Kingdom’s Data Protection Act.

Data security and residency has been a topic of healthy discussion in recent months following the EU decision to dismiss Safe Harbour and the introduction of its successor Privacy Shield. Oracle could be capitalizing on the concerns of cloud buyers as it claims the offering answers business, legislative and regulatory obstacles enterprise organizations face when considering the transition to a cloud platform.

The new product launch forms part of Oracle’s general cloud offensive. “Oracle is now selling more new SaaS and PaaS annually recurring cloud revenue than any other company in the world including Salesforce.com,” said Executive Chairman Larry Ellison, during the quarterly earnings call.

“We are growing much faster than Salesforce.com, more than twice as fast. Because we sell into a lot more SaaS and PaaS market than they do. We compete directly with Salesforce.com in every segment of the SaaS customer experience market including sales, service and market.”

Google, Machine learning, News & Analysis

Google plays catch-up with Cloud Machine Learning

AI-Artificial-Intelligence-Machine-Learning-Cognitive-ComputingGoogle has entered into the machine learning market with the alpha release of Cloud Machine Learning.

Built on top of the company’s open source machine learning system TensorFlow, the offering will allow customers to build custom algorithms the make predictions for their business, aiding decision making.

“At Google, researchers collaborate closely with product teams, applying the latest advances in machine learning to existing products and services – such as speech recognition in the Google app, search in Google Photos and the Smart Reply feature in Inbox by Gmail,” said Slaven Bilac, Software Engineer at Google Research. “At GCP NEXT 2016, we announced the alpha release of Cloud Machine Learning, a framework for building and training custom models to be used in intelligent applications.”

The system is already used in a number of Google’s current offerings, though it is later to market than its competitors. AWS launched its machine learning in April last year, while IBM’s Watson has been making noise in the industry for years.

Although later to market, Google has highlighted that it will allow customers to export their TensorFlow models to use in other settings, including their own on premise data centres. Other offerings operate in vendor lock-in situation, meaning their customers have to operate the machine-learning models they’ve built in the cloud through an API. Industry insiders have told BCN that avoiding vendor lock-in situations would be seen as a priority within their organization, which could provide Google with an edge in the machine-learning market segment.

Cloud Machine Learning’s launch builds on the growing trend towards advanced data analytics and the use of data to refine automated decision making capabilities. A recent survey from Cloud World Forum showed that 85% of respondents believe data analytics is the biggest game changer for marketing campaigns in the last five years, while 82% said that data would define the way in which they interact with customers.

The company is still behind Microsoft and AWS in the public cloud space, though recent moves are showing Google’s intent to close the gap. At GCP NEXT 2016, Google’s cloud chief Diane Greene told the audience that machine learning and security will form the back bone of her new sales strategy. “If your customer is embracing machine learning, it’d be prudent for you to embrace it too,” said Greene.

data centre, Datacentre, Google, News & Analysis, Public Cloud

Googles continues public cloud charge with 12 new data centres

GoogleGoogle has continued its expansion plans in the public cloud sector after announcing it will open 12 new data centres by the end of 2017.

In recent weeks, Google has been expanding its footprint in the cloud space with rumoured acquisitions, hires of industry big-hitters and blue-chip client wins, however its new announcement adds weight to the moves. With two new data centres to open in Oregon and Tokyo by the end of 2016, and a further ten by the end of 2017, Google is positioning itself to challenge Microsoft and AWS for market share in the public cloud segment.

“We’re opening these new regions to help Cloud Platform customers deploy services and applications nearer to their own customers, for lower latency and greater responsiveness,” said Varun Sakalkar, Product Manager at Google. “With these new regions, even more applications become candidates to run on Cloud Platform, and get the benefits of Google-level scale and industry leading price/performance.”

Google currently operates in four cloud regions and the new data centres will give the company a presence in 15. AWS and Microsoft have built a market-share lead over Google thanks in part to the fact that they operate in 12 and 22 regions respectively, with Microsoft planning to open a further five.

Recent findings from Synergy Research Group show AWS is still the clear leader in the cloud space at market share of 31%, with Microsoft accounting for 9% and Google controlling 4%. Owing to its private and hybrid cloud offerings, IBM accounts for 7% of the global market according to Synergy.

Growth at AWS was measured at 63%, whereas Microsoft and Google report 124% and 108% respectively. Industry insiders have told BCN that Microsoft and Google have been making moves to improve their offering, with talent and company acquisitions. Greater proactivity in the market from the two challengers could explain the difference in growth figures over the last quarter.

Alongside the new data centres, Google’s cloud business leader Diane Greene has announced a change to the way the company operates its sales and marketing divisions. According to Bloomberg Business, Greene told employees that Google will be going on a substantial recruitment drive, while also changing the way it sells its services, focusing more on customer interaction and feedback. This practice would not be seen as unusual for its competitors, however Google’s model has been so far built on the idea of customer self-service. The cloud sales team on the west coast has already doubled in size to fifty, with the team planning on widening this recruitment drive.

While Google’s intentions have been made clear over recent months, there are still some who remain unconvinced. 451 Group Lead Analyst Carl Brooks believes the company is still not at the same level as its competitors, needing to add more enterprise compatibility, compliance, and security features. “They are probably the most advanced cloud operation on the planet. It also doesn’t matter,” he said.

Enterprise IT, Eversheds, News & Analysis

Suppliers over-promise on cloud deliverables – survey

Vertrag Stiftbergabe ablehnenA recent survey from law firm Eversheds claims 27% of cloud deals have fallen through due to suppliers not meeting client expectations during contract negotiations.

Despite 77% of respondents claiming they intend to increase cloud spend over the next 18 months, the research claims that a number of deals have not come to fruition due to supplier over promising on what can be delivered within the agreement.

Differing views on what should and can be delivered are only coming to light in the final stages of contract negotiation, when buyers are finding out that suppliers cannot deliver on what had previously been promised.

On top of the 27% who have terminated talks, a further 10% said they were tempted to walk away from the deal because of the differences. Suppliers also backed up these statistics, as 57% of the supplier side respondents said that they had lost deals at the contract stage.

“The number of deals breaking down at the last minute is unnecessarily high given that customers and suppliers have typically reached agreement, at least in principle, before deals get to contract negotiation,” said Charlotte Walker-Osborn, Technology & Outsourcing Partner at Eversheds.

“In cloud negotiations, issues which are both legal and commercial in nature tend to come out during contractual discussions because this is when both parties take an in-depth look at the agreed parameters around the deal. Only then, can it become apparent that differing views may be shared on certain key areas such as data privacy and related security issues,” said Walker-Osborn.

Data protection and residency has once again proved to be a contentious issue, as 33% of the customers surveyed said this was the reason they walked away from the deal. Visibility over the suppliers supply chain was another reason, as 28% of customers claimed this was the reason for the breakdown.

“Cloud purchasers are anxious about where data is hosted for two reasons. The first is regulatory. Data protection and privacy regulations vary across jurisdictions, but most countries require companies to know where their data is hosted and being processed,” said Paula Barrett, Global Head of Privacy at Eversheds.

“Conscientious suppliers will ensure relevant regulatory requirements are covered by the contractual terms. However, some suppliers still fail to include fairly mandatory terms that the law requires their clients to have in place. The second reason is because government authorities in some jurisdictions have the right to access personal data, so it is natural that businesses are concerned about where their data will reside,” said Barrett.

The survey also hints that the mass market is still to be convinced of the reliability and robustness of cloud platforms, despite early adopters demonstrated the value. 48% of cloud buyers highlighted that they would like service credits to compensate for any losses in the event of a service outage as a failsafe, whereas only 20% of service providers were likely to include them in an agreement.

Despite the appetite for cloud services being present in the industry, a lack of clarity from suppliers at the outset has seemingly quashed a number of potential deals, which could potentially be avoided with suppliers taking a more proactive stance on data protection concerns, as well as a more sympathetic view of customer caution when implementing new technologies.

Financial Results, hybrid cloud, News & Analysis, Red Hat

Red Hat CEO pins 21% growth on hybrid cloud market

James WhitehurstRed Hat demonstrated healthy growth in its quarterly earnings, with CEO James Whitehurst attributing the success to the growing hybrid cloud market.

The company reported Q4 revenues at $544 million and total revenues for the year at $2.05 billion, both an increase of 21% on the previous year (constant currency). It now claims to be the only open-source company to have breached the $2 billion milestone.

“Our results reflect the fact that enterprises are increasingly adopting hybrid cloud infrastructures and open source technologies, and they are turning to Red Hat as their strategic partner as they do so,” said Whitehurst. “First, the fourth quarter marked our 56th consecutive quarter of revenue growth which contributed to Red Hat’s first year of crossing the $2 billion in total revenue milestone.”

While public cloud has been dominating the headlines in recent weeks, the Red Hat team remain positive that the hybrid cloud market will ultimately deliver on expectations. “Public cloud has been a great resource for us to reach new customers, including small and medium-sized businesses,” said Whitehurst.

“During meetings Frank (Frank Calderoni, CFO) and I have hosted over the quarter, investors have asked whether the public cloud is a positive driver for Red Hat. We firmly believe that it will be a hybrid cloud world, where applications will run across four – all four footprints; physical, virtual, public cloud, and private cloud.

“Our revenue from private IaaS, PaaS and cloud management technologies is growing at nearly twice as fast as our public cloud revenue did when it was at the same size.”

Although it is unsurprising that Red Hat strongly backs the hybrid cloud model, security and data protection concerns in the industry add weight to the position. Despite progress made in the delivery and management of public cloud platforms, recent research has shown that enterprise decision makers are still concerned about the level of security offered in public cloud, but also where the data will reside geographically. Both concerns are seemingly driven hybrid cloud adoption, giving enterprise the full control on how and where company critical data is stored.

Over the last 12 months, Ret Hat has also confirmed a number of partnerships with major players in the public cloud space to increase its footprint. Last year, a partnership was announced with Microsoft where it became a Red Hat Certified Cloud and Service Provider, enabling customers to run their Red Hat Enterprise Linux applications and workloads on Microsoft Azure. In addition the Certified Cloud and Service Provider platform also has relationships with Google and Rackspace. Red Hat claims that these relationships have resulted in more than $100 million revenue, a 90% increase year-on-year.

“In Q4, we further expanded our technology offerings that can be consumed in the cloud. For instance, RHEL on-demand is activated on Azure in February,” said Whitehurst. “OpenShift, our PaaS solution, and our storage technology will be added to the Google cloud. And RHEL OpenStack platform is now available at RackSpace as a managed service.”

Despite increased competition in the market over recent years, Ret Hat has proved to be effective at holding onto customers. The largest 25 contracts that where up for renewal in the last quarter were all renewed and the new deals were 25% higher in the aggregate. The company also claims that 498 of the largest 500 deals over the last five years have also been removed.

“We never want to lose a deal, if we do, we never give up trying to win back the business,” said Calderoni. “This quarter, I am pleased to report that we closed a multi-million-dollar ‘win-back’ of one of those two former top deals.”

The company also estimates that revenues will grow to between $558 million and $566 million for Q1 and between $2.38 billion and $2.420 billion for the financial year.

Apple, Internet of Things, IoT, News & Analysis

Apple enters consumer e-health market

Apple carekitApple has announced the launch of CareKit, an open-source software framework which enables its consumers and doctors to proactively keep track of their health through monitoring symptoms and medications in real-time.

The open-source framework follows the launch of ResearchKit last year and enables consumers to us data collected from various sources to understand their health. The app also enables consumers to record feedback on how well they are feeling or recovering from a procedure which can be shared with family members and their doctor remotely.

“We’re thrilled with the profound impact ResearchKit has already had on the pace and scale of conducting medical research, and have realised that many of the same principles could help with individual care,” said Jeff Williams, Apple’s COO. “We believe that giving individuals the tools to understand what is happening with their health is incredibly powerful, and apps designed using CareKit make this a reality by empowering people to take a more active role in their care.”

From next month, the developer community will be able to build their own apps through the open-source software, however Apple have designed four modules in the first instance. Care Card is a to-do list reminding consumers to take medication or perform certain exercises, which can be tracked through various Apple devices. The Symptoms and Measurement Tracker enables consumers to record their symptoms and progress. The Insight Dashboard compares the symptoms to the data taken from the Care Card to ensure that treatment is effective, and the Connect module shares all information with the person’s doctor.

The concept of CareKit is one of the few data analytics use cases available to the consumer market, though the open-source framework will offer opportunities for developers. While the framework is not available for the wider community currently, Apple has been working with a number of developers to demonstrate the use case of the framework. One example, Glow Nature, is an app incorporating the CareKit modules to offer advice to women to guide them through a healthier pregnancy.

The launch of CareKit follows healthy adoption of ResearchKit, a similar open-source framework designed for medical researchers. ResearchKit enables doctors, scientists and other researchers to gather data from participants anywhere in the world using iPhone apps. While ResearchKit enables researchers to more accurately gather data and further their research, CareKit provides these organizations an alternative means to communicate with the mass audience.

“With ResearchKit, we quickly realised the power of mobile apps for running inexpensive, high-quality clinical studies with unprecedented reach,” said Ray Dorsey, Professor of Neurology at the University of Rochester Medical Centre. “We hope that CareKit will help us close the gap between our research findings and how we care for our Parkinson’s patients day-to-day. It’s opening up a whole new opportunity for the democratisation of research and medicine.”

data centre, data protection, Datacentre, European Commission, News & Analysis

US revealed to have 46% of all data centres despite EU concerns

Data protectionNew findings from Synergy Research Group show that 46% major cloud and internet data centre sites are located in the US, with second placed China only accounting for 7%.

The research is based on an analysis of the data centre footprint of 17 of the world’s major cloud and internet service firms and highlights the dominance of the US in the cloud market place. Japan is listed at third with a 6% market share and Germany was the largest European player with just 4%.

“Given that explosive growth in cloud usage is a global phenomenon, it is remarkable that the US still accounts for almost half of the world’s major data centres, but that is a reflection of the US dominance of cloud and internet technologies,” said John Dinsdale, Research Director at Synergy Research Group.

Considering the dominance of AWS, Microsoft and Google in the cloud market space, it’s unsurprising that the US is top of the rankings, though recent concerns from European countries regarding movement of its citizens’ data outside of the EU could complicate matters. Germany is one country which is sensitive to any changes in data protection policy and is considered to have some of the most stringent data protection laws worldwide.

“The other leading countries are there due to either their scale or the unique characteristics of their local markets. Perhaps the biggest surprise is that the UK does not feature more prominently, but that situation will change this year with AWS, Microsoft and Google all opening major data centres in the country,” said Dinsdale.

Back in October, the European Court of Justice decided that Safe Harbour did not give data transfers between Europe and the US adequate protection, and declared the agreement which had been in place since 2000 void. The EU-US Privacy Shield, Safe Harbour’s successor, has also come under criticism in recent weeks as concerns have been raised to how much protection the reformed regulations protect European parties.

While the new agreement has been initially accepted, privacy activist Max Schrems, who has been linked to the initial downfall of Safe Harbour, said in a statement reacting to Privacy Shield, “Basically, the US openly confirms that it violates EU fundamental rights in at least six cases. The commission claims that there is no ‘bulk surveillance’ any more, when its own documents say the exact opposite.” A letter from Robert Litt General Counsel of the Office of the Director of National Intelligence, confirmed that there were six circumstances where the NSA will be allowed to use data for undefined “counter-terrorism” purposes

While the concentration of data centres in the US should not come as a huge surprise, it puts into further context the fears of European parties who are concerned with the effectiveness of any EU-US data protection policies.

Enterprise IT, GoDaddy, News & Analysis, Public Cloud

GoDaddy lauches cloud services tailored for small businesses

Godaddy logo matWeb hosting company GoDaddy has expanded its offering for small business customers to include Cloud Servers and Bitnami-powered Cloud Applications.

GoDaddy, which claims to have more than 61 million domain names under management, will offer its customers a “pay as you go” utility billing model, which will enable customers build, test and scale cloud solutions on GoDaddy’s infrastructure. The company’s traditional playing field is to give customers access to site building software like Word Press, but the new move will provide an environment where they can build and run just about any software they like.

“With the launch of Cloud Servers, GoDaddy aims to extend our lead as the number one trusted provider of Cloud Hosting solutions for individual developers and technologists. We’re looking to make it easy for developers to serve small businesses with the technology they want,” said Jeff King, GM Hosting, Security at GoDaddy. “By offering a powerful, yet simple cloud offering that integrates domains, DNS, security and backups all in one place, developers can save time and exceed their clients’ expectations.”

Unlike its better-known rivals in the cloud space, GoDaddy will build on its traditional business model of targeting individual developers, tech entrepreneurs and small-scale businesses with the new solution. The services will offer a number of features to smaller businesses that cannot afford or justify an all-encompassing service offered by the traditional players in the public cloud market. The company claims virtual instances can be built, tested, cloned and re-provisioned in less than a minute, meeting market expectations.

Alongside the servers, GoDaddy’s Cloud Applications are powered by Bitnami, an open source server application deployments library. “As a GoDaddy technology partner on Cloud Applications, we’re excited for GoDaddy’s international customer base to take advantage of our capabilities – joining the millions of developers and business users who save time and effort with our library’s consistent, secure and optimized end-user experience,” said Erica Brescia, Co-Founder at Bitnami. “We’re proud to partner with GoDaddy in serving this global market of advanced SMB-focused developers.”

The new offering from GoDaddy has seemingly been in the works for some time, as the team announced the acquisition of the public cloud customer division of Apptix for $22.5 million last September.

“With the acquisition of Apptix’s public cloud customer base, we have an opportunity to take customers using Hosted Exchange and bring them over to GoDaddy’s Microsoft Office 365 offering,” said Dan Race, GoDaddy’s VP of Corporate Comms, at the time.

With Microsoft and Google making moves to take market share away from AWS in the corporate space, GoDaddy is targeting the small business market, a niche that appears to be relatively overlooked.

AWS, Cisco, Enterprise IT, HPE, IBM, Microsoft, News & Analysis

HPE holds off Cisco for cloud infrastructure top spot

HPE street logoFindings from Synergy Research Group have HPE as the number one provider in the cloud infrastructure equipment market, narrowly outperforming Cisco over the course of 2015.

Total revenues for the cloud infrastructure equipment segment reached over $60 billion in 2015, with HPE accounting for just over 12%, and Cisco just under. Dell, Microsoft and IBM complete the top five, each controlling about 7% market share.

“There continues to be particularly impressive growth in the public cloud infrastructure market as AWS and other cloud operators are having tremendous success in attracting enterprises to their ever-expanding range of service offerings,” said Jeremy Duke, Synergy Research Group’s founder. “But enterprises too are buying ever-larger volumes of infrastructure to support their private or hybrid cloud deployments. Across the board there is a massive swing away from enterprises running workloads over more traditional and inflexible IT infrastructure.”

Synergy’s research showed between Q4 2014 and Q3 2015 total spend on infrastructure hardware and software to build cloud services exceeded $60 billion. Spend on private cloud accounted for more than 50% of these revenues, though public cloud is growing at a faster pace. HPE currently leads the private cloud space, with Cisco in second, however the roles are reversed for the public cloud segment.

While HPE and Cisco remain dominant in the server and networking segments, both companies have been releasing a number of new products in recent months to diversify their offering. Last week, HPE launched its ‘machine-learning-as-a-service’ on Microsoft Azure, which combines 60 API’s to provide machine learning capabilities. While HPE is seemingly capitalizing on the growing ‘as-a-service’ trend, Cisco is focused on its cloud-based collaboration service, Cisco Spark, which was launched with Verizon recently.

Market share graphMicrosoft features in the list due to its position in the server OS and virtualization applications market, where as Dell and IBM have demonstrated strong offerings in a broad number of cloud technology markets. Servers, OS, storage, networking and virtualization software combined accounted for 95% of the Q4 cloud infrastructure market.

While hardware and software to build cloud services revenues exceeded $60 billion, other areas of the industry demonstrated stronger growth. Public IaaS/PaaS services had the highest growth rate at 51%, followed by private & hybrid cloud infrastructure services at 45%.

“In many ways 2015 was the year when cloud became mainstream. Across a wide range of cloud applications and services we have seen that usage has now passed well beyond the early adopter phase and barriers to adoption continue to diminish,” said Duke. “Cloud technologies are now generating massive revenues and high growth rates that will continue long into the future, making this an exciting time for IT vendors and service providers that focus on cloud.”

CRM, Enterprise IT, IBM, News & Analysis, Public Sector

IBM acquires Optevia to strengthen position in public sector CRM market

cloud_IBM claims the acquisition of Optevia will improve its position as a SaaS and digital consultant in the lucrative market. Optevia has a track record of working with UK Emergency Services, Central Government, Local Government and Social Enterprises, including the Ministry of Justice’s National Taxing Team’s rollout of Dynamics CRM.

“By acquiring Optevia, IBM will be able to provide Public Sector clients and prospects with a range of unique, industry focused Microsoft Dynamics CRM based solutions,” said Joanna Davinson, IBM’s European Public Sector Leader. “This strategic acquisition will help strengthen IBM as a SaaS provider and Global Software Integrator.”

In Gartner’s CRM Forecast Overview, published last summer, the global CRM market was valued in the region of $23 billion, with around 50% of the market accounted for by the top 5 services providers. SaaS continued to demonstrate strong demand, with almost 47% of the revenue attributed to the service. According to Gartner,Salesforce.com is the market leader, with IBM claiming 4% of the CRM segment.

While IBM already has an established position in the public sector market, the company has 98 current offerings on G-Cloud, the acquisition of Optevia signals its intentions of increasing its share of the public sector CRM segment.

Alongside IBM, other players have been bolstering their position in the wider CRM market. Last year, Accenture acquired Tquila and Cloud Sherpas, both of which are Salesforce partners on G-Cloud. The acquisitions more than doubled the number of Accenture’s Salesforce consultants in the UK.

“We have seen significant growth in SaaS as more companies adopt the cloud and digital strategies to collaborate better, drive greater operational efficiencies and accelerate the development of new products and services,” said Emma McGuigan, UK and Ireland MD at Accenture Technology. “One key factor for our continued success in delivering Salesforce solutions depends on having the right skilled professionals to meet the growing demand. With Tquila on board we have the critical mass to more proactively target big opportunities both in the UK and Europe, which will extend our position in the region.”

Despite Salesforce.com’s current market-leading position there have been a number of calls-to-arms by competitors looking to challenge the CRM giant. Alongside IBM’s announcement, Oracle has hinted at its intention to take on Salesforce.com. On Oracle’s earnings call this week, CTO Larry Ellison highlighted the company’s positioning “should make it easy for Oracle to pass Salesforce.com and become the largest SaaS and PaaS cloud company in the world.”